5 Tips on How to Manage Your Retirement Portfolio Risk

Saving and investing for retirement needs long-term financial discipline and watertight planning. It is the most important financial exercise in your life, and you must manage its risks well. These tips will help you to manage your retirement portfolio risks better.

Risk assessment

From fixed deposits to futures and options and everything in between, there are plenty of investment opportunities. As the investor, you have to find out your risk appetite and invest accordingly. For every Rs 100 you have, you may have an appetite to invest no more than Rs 40 in equity, for instance. Young and aggressive investors may be fine with even 75% investment in shares. Conservative investors, on the other hand, are known to invest heavily in debt investments instead.

Asset allocation and diversification

You will have to design your asset basket depending on your aforementioned risk appetite. Shares, bonds, gold, real estate, etc., must be selected in a proportion that is within your risk tolerance yet is productive enough to meet your post-retirement financial goals. For instance, an investment in gold could be made with an expectation that it will foil the market volatility of equity investments.


While returns are the key to investments, a certain amount of liquidity is also important. If all of your investments are tied up in long-term instruments, you will suffer losses in meeting sudden financial needs. You will either have to avail of an expensive emergency loan or liquidate an asset at a loss. But having some investments in the likes of liquid mutual funds and overnight funds will help you in times of need.

Long-term investment

To ensure that your retirement portfolio generates consistent growth, you have to hold the investment for the long term. A major risk in retirement portfolio management is the need to liquidate the investment for emergencies and losing out on the growth and compound interest. A consistent investment from the 20s till the late 50s gives you a long-term window to grow. Equity investments get the time to recover from recessions and cash in on multiple bull runs. In mutual funds, SIP offers a long-term investment solution that can generate an impressive return when invested for a couple of decades or more.


A long-term investment mustn’t be made to continue in an auto-pilot mode. True, long-term debt investments have the assurance of safety. But what if interest rates are falling continuously, and fresh investments in it may not be good enough to beat inflation. Similarly, what if your favorite blue-chip company is losing its profitability to new players? Regular monitoring ensures that your retirement fund grows at your expected pace and portfolio adjustments are timely made if required.


With the Tata Capital Moneyfy App, you can also select a SIP or even a Systematic Withdrawal Plan that can cover your post-retirement costs. If you plan to start building your retirement portfolio, Moneyfy can be your ideal platform for not just comparing and selecting but also continuing a long-term investment in mutual funds.